JUSTICE TRIEWEILER
dissenting.
I dissent from the opinion of the majority.
In
Lasar v. E. H. Oftedal & Sons
(1986), 222 Mont. 251, 721 P.2d 352, and again in
Komeotis v. Williamson Fencing
(1988), 232 Mont. 340, 756 P.2d 1153, this Court blatantly ignored the plain language of Section 39-71-612, MCA (1979), to conclude that a court award of benefits is a condition to an award of attorney fees. In this case, the majority blindly follows its prior decisions without any analysis of the plain terms of the attorney fee statute.
Section 612 does not simply provide that when the court’s award is greater than the amount offered, the claimant is entitled to an attorney fee. It clearly provides that when the ultimate settlement is greater than the amount originally offered, the claimant is entitled to recover his attorney fees which were incurred to pursue his claim for the full amount of his benefits. That section states:
If an employer or insurer pays or tenders payment of compensation under chapter 71 or 72 of this title, but controversy relates to the amount of compensation due and
the settlement
or award is greater
than the amount paid or tendered by the employer or insurer, a reasonable attorney’s fee as established by the division or the workers’ compensation judge if the case has gone to a hearing, based solely upon the difference between
the amount settled for
or awarded and the amount tendered or paid, may be awarded in addition to the amount of compensation. [Emphasis added.]
Section 39-71-612(1), MCA (1979).
In this case, claimant demanded that he be paid permanent total disability benefits on March 1, 1991. That demand was rejected by defendant on April 4,1991. Claimant filed his petition for permanent total disability benefits on July 19, 1991, and in its answer dated August 7, 1991, defendant denied that claimant was permanently totally disabled. Defendant continued in that denial as late as the pretrial conference on August 22, 1991. Therefore, according to our prior case law, there was a controversy over the amount of compensation due.
We held, in
Krause v. Sears Roebuck & Company
(1982), 197 Mont. 102, 641 P.2d 458, that:
The basic controversy between the parties was one dealing with the difference between the amount of benefits tendered and the amount of benefits awarded, and the issue of whether the claimant’s disability was permanent was the foundation for that controversy. Because the court concluded that the claimant was suffering from a
permanent
total disability, we hold that under § 39-71-612, MCA, the claimant is entitled to attorney fees and costs in relation only to his proof that he was permanently totally disabled.
Krause,
641 P.2d at 462.
In other words, we have previously held that when the controversy is whether claimant is permanently or temporarily disabled, that is a controversy relating “to the amount of compensation due” within the contemplation of § 39-71-612, MCA(1979). As of August 22,1991, there was such a controversy in this case.
On August 29, 1991, that issue was settled when defendant conceded that claimant was permanently totally disabled. On that date, then, there was a settlement for benefits greater in value than the benefits that had been previously tendered, and according to the plain language of § 39-71-612, MCA (1979), claimant was entitled to an award of attorney fees that were incurred to recover the full amount of his benefits.
The majority opinion completely ignores the language in the attor
ney fee statute which provides that when a settlement is greater than the amount originally offered, claimant is entitled to recover an attorney fee. This Court ignored that language in the
Lasar
case; it ignored it in the
Komeotis
case; and like an ostrich with its head buried in the sand, the majority continues to ignore that language in this case for the apparent reason that its erroneous precedent is more important than the plain language of the statute.
I would reverse this Court’s decisions in
Lasar
and
Komeotis
and reverse the trial court’s refusal to grant attorney fees in this case.
I would also reverse the Workers’ Compensation Court’s refusal to award the statutory penalty to claimant pursuant to § 39-71-2907, MCA (1979). That statute provides that when payment of compensation has been unreasonably delayed or refused by an insurer, a penalty equal to 20 percent of those benefits may be awarded. In this case, the insurer’s conduct was unreasonable in two respects.
According to the testimony of claimant’s claims representative who handled this claim, she had all of the vocational and medical information with which to make an evaluation of claimant’s disability by June 5,1991. Cathy Andersen testified that she had a medical report concluding that claimant was unable to work in any capacity as early as April 19,1991. She acknowledged that she had vocational evaluations and psychological reports by June 5,1991, which indicated that claimant has the equivalency of a sixth grade education, that he has a learning disability, and that he was not a candidate for retraining. Furthermore, she admitted that she received no additional medical or vocational information from that date until Sears conceded permanent total disability on August 29, 1991. And yet, defendant’s attorney continued to take the position in his answer to claimant’s petition, and again at the time of the pretrial conference, that claimant was not permanently totally disabled. Obviously, defendant continued to deny liability for the full extent of claimant’s disability, even though it was fully aware of claimant’s condition, in order to strengthen its bargaining position for purposes of settling claimant’s claim. In doing so, I conclude that it acted unreasonably.
Furthermore, defendant acted unreasonably when, without any basis in fact, it refused to convert a portion of claimant’s future disability benefits to a lump sum pursuant to § 39-71-741, MCA. This is apparent from the following finding entered by the trial court:
Defendant has designated Cathy Andersen as its claims adjuster in Montana relative to this case. However, Andersen testified that she was not privy to petitioner’s affidavit regarding a
lump sum, nor had she seen petitioner’s discovery responses, nor had she read petitioner’s deposition. Hence, she knew of
no reasons
why petitioner’s lump sum request had not been granted, and she had absolutely
no information
as to whether payment of the lump sum request was in petitioner’s best interest. Moreover, Andersen had
no explanation
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JUSTICE TRIEWEILER
dissenting.
I dissent from the opinion of the majority.
In
Lasar v. E. H. Oftedal & Sons
(1986), 222 Mont. 251, 721 P.2d 352, and again in
Komeotis v. Williamson Fencing
(1988), 232 Mont. 340, 756 P.2d 1153, this Court blatantly ignored the plain language of Section 39-71-612, MCA (1979), to conclude that a court award of benefits is a condition to an award of attorney fees. In this case, the majority blindly follows its prior decisions without any analysis of the plain terms of the attorney fee statute.
Section 612 does not simply provide that when the court’s award is greater than the amount offered, the claimant is entitled to an attorney fee. It clearly provides that when the ultimate settlement is greater than the amount originally offered, the claimant is entitled to recover his attorney fees which were incurred to pursue his claim for the full amount of his benefits. That section states:
If an employer or insurer pays or tenders payment of compensation under chapter 71 or 72 of this title, but controversy relates to the amount of compensation due and
the settlement
or award is greater
than the amount paid or tendered by the employer or insurer, a reasonable attorney’s fee as established by the division or the workers’ compensation judge if the case has gone to a hearing, based solely upon the difference between
the amount settled for
or awarded and the amount tendered or paid, may be awarded in addition to the amount of compensation. [Emphasis added.]
Section 39-71-612(1), MCA (1979).
In this case, claimant demanded that he be paid permanent total disability benefits on March 1, 1991. That demand was rejected by defendant on April 4,1991. Claimant filed his petition for permanent total disability benefits on July 19, 1991, and in its answer dated August 7, 1991, defendant denied that claimant was permanently totally disabled. Defendant continued in that denial as late as the pretrial conference on August 22, 1991. Therefore, according to our prior case law, there was a controversy over the amount of compensation due.
We held, in
Krause v. Sears Roebuck & Company
(1982), 197 Mont. 102, 641 P.2d 458, that:
The basic controversy between the parties was one dealing with the difference between the amount of benefits tendered and the amount of benefits awarded, and the issue of whether the claimant’s disability was permanent was the foundation for that controversy. Because the court concluded that the claimant was suffering from a
permanent
total disability, we hold that under § 39-71-612, MCA, the claimant is entitled to attorney fees and costs in relation only to his proof that he was permanently totally disabled.
Krause,
641 P.2d at 462.
In other words, we have previously held that when the controversy is whether claimant is permanently or temporarily disabled, that is a controversy relating “to the amount of compensation due” within the contemplation of § 39-71-612, MCA(1979). As of August 22,1991, there was such a controversy in this case.
On August 29, 1991, that issue was settled when defendant conceded that claimant was permanently totally disabled. On that date, then, there was a settlement for benefits greater in value than the benefits that had been previously tendered, and according to the plain language of § 39-71-612, MCA (1979), claimant was entitled to an award of attorney fees that were incurred to recover the full amount of his benefits.
The majority opinion completely ignores the language in the attor
ney fee statute which provides that when a settlement is greater than the amount originally offered, claimant is entitled to recover an attorney fee. This Court ignored that language in the
Lasar
case; it ignored it in the
Komeotis
case; and like an ostrich with its head buried in the sand, the majority continues to ignore that language in this case for the apparent reason that its erroneous precedent is more important than the plain language of the statute.
I would reverse this Court’s decisions in
Lasar
and
Komeotis
and reverse the trial court’s refusal to grant attorney fees in this case.
I would also reverse the Workers’ Compensation Court’s refusal to award the statutory penalty to claimant pursuant to § 39-71-2907, MCA (1979). That statute provides that when payment of compensation has been unreasonably delayed or refused by an insurer, a penalty equal to 20 percent of those benefits may be awarded. In this case, the insurer’s conduct was unreasonable in two respects.
According to the testimony of claimant’s claims representative who handled this claim, she had all of the vocational and medical information with which to make an evaluation of claimant’s disability by June 5,1991. Cathy Andersen testified that she had a medical report concluding that claimant was unable to work in any capacity as early as April 19,1991. She acknowledged that she had vocational evaluations and psychological reports by June 5,1991, which indicated that claimant has the equivalency of a sixth grade education, that he has a learning disability, and that he was not a candidate for retraining. Furthermore, she admitted that she received no additional medical or vocational information from that date until Sears conceded permanent total disability on August 29, 1991. And yet, defendant’s attorney continued to take the position in his answer to claimant’s petition, and again at the time of the pretrial conference, that claimant was not permanently totally disabled. Obviously, defendant continued to deny liability for the full extent of claimant’s disability, even though it was fully aware of claimant’s condition, in order to strengthen its bargaining position for purposes of settling claimant’s claim. In doing so, I conclude that it acted unreasonably.
Furthermore, defendant acted unreasonably when, without any basis in fact, it refused to convert a portion of claimant’s future disability benefits to a lump sum pursuant to § 39-71-741, MCA. This is apparent from the following finding entered by the trial court:
Defendant has designated Cathy Andersen as its claims adjuster in Montana relative to this case. However, Andersen testified that she was not privy to petitioner’s affidavit regarding a
lump sum, nor had she seen petitioner’s discovery responses, nor had she read petitioner’s deposition. Hence, she knew of
no reasons
why petitioner’s lump sum request had not been granted, and she had absolutely
no information
as to whether payment of the lump sum request was in petitioner’s best interest. Moreover, Andersen had
no explanation
regarding Sears’ refusal to concede permanent total disability until three weeks before the original trial setting. It was apparent at trial that only defense counsel and an adjuster in Linwood, Washington, were making the decisions and denying petitioner’s requests. Andersen had little, if any, authority regarding petitioner’s file. [Emphasis added.]
As pointed out by the Workers’ Compensation Court, 24.29.804(1) ARM, provides as follows:
Every insurer is required to designate at least one adjuster, maintaining an office in Montana, which shall pay compensation when due and which shall have authority to settle claims.
The adjuster for defendant who had the responsibility to pay compensation which was due with regard to this claim was Cathy Andersen, and yet, defendant’s attorney did not even provide her with the information that formed the basis for claimant’s claim. There is no way she could have acted reasonably. The fact that she did not is evident by the last minute concession regarding the nature of claimant’s disability and the Workers’ Compensation Court’s decision to convert a part of claimant’s disability benefits to a lump sum, in spite of defendant’s refusal to do so.
Insurers who force claimants to incur the expenses of litigation and who clog Montana’s Workers’ Compensation Court because of this kind of conduct are the exact parties for whom § 39-71-2907, MCA, was intended.
In this decision, this Court has ignored the plain language of the Workers’ Compensation Court in two respects. It has refused to award attorney fees, and it has refused to impose the statutory penalty when both were clearly warranted.
Apparently, the principles of “strict construction” about which “conservative” jurists so proudly pound their chests, don’t apply to the statutory rights of injured workers.
For these reasons, I dissent from both conclusions in the majority opinion.
JUSTICE HUNT concurs in the foregoing dissent of JUSTICE TRIEWEILER.